Gowalla version 2.0 for the iPhone just hit the App Store today. With it, you’ll notice a few different things. First and foremost, the overall look has been updated from a sort of Army green, to a more subtle light green that is much easier on the eyes. More significantly, the toolbar has been reworked so that now social activity is front and center when you load the app, while your own activity is the last tab. Both of these changes are things I’ve complained about since day one with Gowalla, so they’re certainly welcome. But that’s not why I’m excited for the app. I’m excited because it takes the idea of the check-in and extends it.

Specifically, you can now add pictures and comments to check-ins in Gowalla. This makes for a much richer social experience both using the app and the website (the data goes over there as well). As founder and CEO Josh Williams describes in the video below, there were a lot of people who wanted to talk about the social activity on Gowalla, but previously they had to text message or email their friends to say something like “hey I saw you check-in at the restaurant, want some company?” Now, that type of dialogue can take place all within the app.

Now, others have tried to add additional layers to check-ins in the past. Why I think it works with Gowalla 2.0 is because they keep it simple. The application is extremely handsome (since the beginning, everyone is quick to note how good the designers are working for the team) and intuitive. There are only a few basic things you can do, and all are obvious from the main screen. You can either check-in at a venue, comment on your friends’ check-ins (with the new chat bubble in the stream), look at the spots around you, see trips (pre-planned venue excursions), or look at your own activity.

Previously, with Gowalla, I thought the focus was too much on their virtual items. Those are now tucked away in your Passport (your profile). They’re still important, and will be increasingly so for Gowalla’s revenue model (trading virtual goods for real-world items), but they’re not in your face, confusing users.

All that said, there are two downsides still to the service. First, the social activity stream includes everybody that your friends with. With Foursquare, the people currently in the same city as you are highlighted; Gowalla doesn’t do that. I suspect that will be very annoying to my friends not going to Austin this week for SXSW. Their stream will be a constant reminder that they’re not there — and they likely could care less about my check-ins, since they can’t possibly come and meet me.

The second downside is that Gowalla’s API remains read-only. That means while other services can pull out Gowalla’s data, they can’t put anything back in. That means there will be no Gowalla apps besides the ones they make (at least for now). Williams explained the rationale behind this as Gowalla wants to stay in control of the user experience (a rather Apple-like argument). That makes some sense, since there are all these virtual goods that will be flying around, and it will be hard to make sure every third-party app is implementing them correctly. Also, Gowalla is much more strict about its location-based check-ins then say, Foursquare. They’re so strict, in fact, that it’s been an issue in the past (and in some cases, still is), with people not being able to check-in places they’re actually at because the GPS is wonky. At the same time, this helps a lot with gaming the system, and that will be increasingly important as Gowalla strikes deals with partners based around check-ins.

Listen to Williams talk more about the new app, as well as his thoughts on AT&T’s network, some SXSW specials, rivals, and yes, even the news that Facebook is apparently looking at federating some of Gowalla’s (and Foursquare’s) data for its own location offering. He also notes that with the new release, Gowalla is expanding the idea of checking-in to be more of a bucket of elements now, including images and comments. Interesting. (Sorry in advance that I shot the video vertically on my iPhone — gotta stop doing that.)